Responsible Investment retail fund sales in UK up almost 300% – trade body

Responsible investment funds saw net retail sales of £7.1bn (€7.8bn) for the year-to-date; this is up from £1.9bn for the first three quarters of 2019, according to the UK's Investment Association.

Overall the trade body, representing 250 investment managers and asset management firms in the UK, found responsible investment funds under management stood at £40bn as of the end of September – their overall share of industry funds under management was 3%.

“In a year clouded by uncertainty, responsible investment funds are a beacon” – Chris Cummings

Chris Cummings, Chief Executive of the Investment Association, said: “The year so far has seen record investment into responsible investment funds. In a year clouded by uncertainty, responsible investment funds are a beacon for how savers can put their money to work to support positive change globally, and our industry can be proud that these funds are reaching new heights of popularity.”

Indeed, these findings are the latest in a swathe of reports this year which have pointed to the growing presence, and resilience, of sustainable and/or ESG related financial mechanisms. 

Most recently, research by PwC explained that assets in sustainable investment products in Europe could triple to €7.6trn over the next five years, meaning they will outweigh conventional funds. In a survey of 300 investors, the firm also found that more than three-quarters said they would stop buying conventional funds in favour of ESG products by 2022. Even in the base-case scenario, sustainable funds are set to constitute 41% of the European fund market by 2025. PwC said the trend was driven by regulation and growing awareness of ESG risks. 

The Investment Association found that UK savers put £5.3bn into retail funds in the third quarter of 2020 – more than three times the net retail sales of in the prior year period. Additionally, bond funds continued to see strong net retail sales reaching £1.2 billion in September, boosted by the Global Bond sector’s record sales of £937m, while active funds saw positive net retail sales of £336m in September 2020, and net retail sales to tracker funds remained consistently strong at £1.3bn.